Beijing Tongrentang (600085) investor relations material

Executive summary

• 9M revenue fell 16.90% YoY and attributable net income fell 26.48%; Q3 declines deepened to 24.28% and 39.87%, respectively, amid consumer-market and pharmacy-retail pressure.

• Cost-control measures contained selling and administrative expenses, but lower revenue continued to weigh on profit.

Financial highlights

• Q3 revenue was RMB 2.680bn, total profit RMB 165.0m, and attributable net income RMB 139.5m, down 24.28%, 52.38%, and 39.87% YoY, respectively.

• 9M revenue was RMB 11.059bn, total profit RMB 1.345bn, and attributable net income RMB 865.7m, down 16.90%, 31.37%, and 26.48% YoY, respectively.

• 9M adjusted attributable net income, excluding non-recurring items, was RMB 842.3m, down 27.55% YoY; Q3 adjusted income was RMB 129.0m, down 41.45%.

• 9M operating costs were RMB 9.701bn; selling expenses were RMB 2.064bn versus RMB 2.612bn a year earlier, while R&D expenses rose to RMB 197.8m from RMB 142.9m.

Key financial ratios and metrics

• 9M basic EPS was RMB 0.631, down 26.54% YoY; weighted average ROE was 6.29%, down 2.43 percentage points.

• 9M operating cash flow was RMB 1.875bn, down 5.68% YoY; total assets were RMB 29.298bn, down 4.32% from year-end, and parent equity was RMB 13.742bn, up 0.62%.